US-East Asia News 12-30-19

Tag: US-China

American-Chinese relations are in a difficult position. Tensions over trade, territory, and North Korea, among others, has turned their relationship into an all-out rivalry. But there are ways to improve the current predicament so that both sides may feel more secure and benefit from their relationship.

On the American side, there are a variety of methods that they can enact to ease tensions and improve cooperation. First and foremost, the trade war pushed forward by President Trump must be ended. He is not wrong that the Chinese government has manipulated the scales in order to benefit their own economy, but a trade war only serves to increase tensions and will do significant harm to numerous wings of the American economy. Instead, the President should promote economic interdependence, tying China as heavily to the American economy as heavily to the United States as possible. This would be a major piece in a much broader program of creating more open forums for discussion and cooperation. As the world’s two leading nations, there must be numerous, and easy to use lines of dialogue in order solve issues and bolster their interests.

Naturally though, the US is skeptical of China’s rising power and is rightfully concerned about Chinese investment and acquisitions in such areas as artificial intelligence and other dual-purpose technologies. As such, it was wise to strengthen their Committee on Foreign Investment and more steps should be taken to ensure sensitive technology and information is protected. On that note, the US should focus more heavily on their cyber defense capabilities. The US has an extensive arsenal of cyber tools, but they are focused on offensive capabilities, which opened not only itself, but the world to cyber attack when those tools are lost, and the US can be sure that China is bolstering is capacity to wage war in cyberspace.

Finally, the US must reinvigorate old alliances. The President may see legit issues with current alliances, but in these times of nervousness and tension he would do well to set aside these points of contention, at least for now. The US must join with friendly nations like Japan, South Korea, and Australia, to properly handle the problems associated with China’s rising power. It must also join with newer partners, such as Vietnam, the Philippines, and Indonesia, who have shown increasing concern about their larger neighbor.

However, the US is not the only one which must change if a resolution is to be found. China has issues, as well, that it must address if it wishes to ease current tensions.

Firstly, China must cease its territorial ambitions in the South China Sea. Its profound claims of ownership, coupled with its island building and sequent construction of military installations, is an affront to international stability and disturbs numerous countries, such as the previously mentioned Vietnam.

Another action China must take, should it wish to ease tensions abroad, is open up their markets. China is notorious for limiting foreign access to its markets at the same time it is actively pumping money into other markets including real estate and artificial intelligence. This has led to frustration by China’s two largest trading partners: the European Union, and the United States. Added onto to this is the issue of China’s State-Owned Enterprises (SOEs), which are insulated from outside forces. These too, must be made more open, at least in some, non-strategic sectors, not only to elevate pressure from foreign entities looking to enter the Chinese market, but also to end the drain on China’s economy itself.

On the issue of economics, China must also gain a respect for intellectual property rights. The scope of China’s intellectual theft is extensive with a 2017 updated report from the Commission on the Theft of American Intellectual Property stating the cost to the US economy totaling somewhere between $225 and $600 billion annually. This can only do harm to any relationship between the US and China and will remain an open wound for future grievances until properly addressed.

There are also actions that both may improve their relationship. As stated earlier, creating or improving existing conferences and institutions that allow for a forum of discussion and a mode to address issues is vital. Should tensions between the two strain their capacity for an open dialogue, a chain of communication, such as through Japan or South Korea, could also be utilized. This would have the added benefit of bringing such countries into the fold and decreasing the risk that they feel sidelined.

These are but a few methods that may be used to improve the current condition of US-China relations and ease concerns amongst the many parties, and there are certainly others. For both countries they may find the suggestions provided difficult to implement, or even against their perceived interests. In some ways they may be right. However, it’s to no one’s interests that the US and China, the two largest economies, vaste populations, and both controlling nuclear arsenals, should come into conflict.

Bibliography

Congress Strengthens Reviews of Chinese and Other Foreign Investments, New York Times, August 1, 2018

Security Breach and Spilled Secrets Have Shaken the N.S.A. to Its Core, New York Times, November 12, 2017

Chinese investors are inflating housing markets in the US, Canada, and Australia, Business Insider, June 10, 2018

The European Commission, China, Trade, http://ec.europa.eu/trade/policy/countries-and-regions/countries/china/

Fixing China Inc, The Economist, August 30th, 2014

The Unreal Scope of China’s Intellectual Property Theft, The American Conservative, July 23, 2018

Update to the IP Commission Report, The Commission on the Theft of American Intellectual Property, published by The National Bureau of Asian Research, February 2017, initial Report May 2013

The World Bank, World Integrated Trade Solution, China, https://wits.worldbank.org/CountryProfile/en/Country/CHN/Year/LTST/TradeFlow/EXPIMP/Partner/by-country